NEW YORK (AP) — Whole Foods announced a board shake-up and cost-cutting plan Wednesday as it fights to hold onto shoppers who have more choices about where to buy the natural and organic foods it’s known for.
The company also said sales fell 2.8 percent at established locations for the three months ended April 9, the seventh straight quarter in which the closely watched metric has declined. Whole Foods has blamed its struggles on customers increasingly turning to “good enough alternatives.” Overall competition is also intensifying, with more places where people can get groceries.
Whole Foods says it named five new independent directors to its board, including Panera CEO Ron Shaich, as well as a new board chair and new chief financial officer. It also announced a range of moves aimed at improving its financial results, including plans to cut $300 million in costs by its fiscal 2020.
Whole Foods said it expects sales at established locations to turn positive by the end of its fiscal 2018.
The moves come after activist investor Jana Partners disclosed a stake in Whole Foods last month and outlined an array of issues it wanted to discuss with the Austin, Texas-based company. Whole Foods shares rose nearly 2 percent to $36.95 in after-hours trading.
For its fiscal second quarter, Whole Foods said its profit fell to $99 million, or 31 cents per share. Not including one-time items, it earned 37 cents per share, which was in line with Wall Street expectations, according to Zacks Investment Research. Total revenue was $3.74 billion, above the $3.73 billion analysts expected.